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Ask the HOA Expert: HOA Volunteers

Question: Volunteers are an important part of HOA living. But how does a board deal with owners who are totally negative, derail attempts to reach agreement, disrupt meetings and yet want to serve on committees?

Answer: HOAs are designed to work like a representative democracy. That means that the board is elected and given authority to make decisions. The fact that some members don't like how the board runs things is no surprise. Welcome to America. The board should respond to their challenges within reason but not waste time trying to placate them. That can be a full time job and waste of time considering they are rarely, if ever, satisfied.

The board is under no obligation to appoint anyone that wants to serve to a committee. Committee appointments should make sense and the board typically wants members that will help, not hinder, the board's work. For more on this topic, see Regenesis.net in the Committees section.

The board does not need to tolerate disruptions at meetings. Meetings should be structured so that members have a right to speak during a member forum but not otherwise unless the board president asks for their opinion. If they disrupt a board meeting, they should be asked to leave. If they refuse, the president should adjourn the meeting and refuse to admit them at future board meetings until they promise to behave. For more on this topic, see Regenesis.net in the Meetings section.

If these folks are going door to door trying to stir discontent, the board should do periodic informational newsletters and flyers to set the record straight. There are some irritating aspects about free speech but truth is truth and lies are lies and most people can tell the difference. Take heart.

Question: Our HOA recently established a reserve account which is earning interest income. The board doesn't want the HOA to pay tax on the interest income, so each owner was issued a Form 1099 for a portion of the interest income with instructions to report the interest on their individual returns. The actual interest remains in the reserve account in the HOA's name. Is this proper?

Answer: If the reserve funds belong to the HOA (usually the case), taxes on interest income cannot be passed through to individual members. The HOA is responsible for recognizing and paying the resulting tax.

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